Cormac O'Dea, a senior research economist at IFS, said couples reaching state pension age have enough money to fund their lifestyles

Nine out of ten couples born in the 1940s have more than enough money to fund their lifestyles in retirement, Britain’s leading economic forecaster reveals today.

The Institute for Fiscal Studies said these couples, many of whom retire on two thirds of their working income, have a ‘surplus’ of around £225,000.

But it warns that millions of younger people have little prospect of enjoying such an enviable lifestyle when they stop work, with many forced to keep on working longer than they would like.

Cormac O’Dea, a senior research economist at the IFS, said: ‘The large majority of couples reaching state pension age in recent years have more wealth than necessary to maintain their standards of living into retirement.

‘This is a cohort that has ended up saving more than they needed for retirement. The picture for future generations, however, may look quite different.’

Researchers looked at older couples, who were classified as the man being born in the 1940s with a wife or partner of any age. Overall, it found the ‘optimal wealth’ for these couples is £77,000 – the total value of their income and assets – if they want to maintain the standard of living that they had while working.

For many people, this means they retire with an income equal to two-thirds of the salary that they received before they stopped work. But their ‘observed’ wealth – that is, the amount of money that they actually have – is more than £320,000.

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This includes the value of their pension, savings and investments and the value of their home, excluding any mortgage. It found that 92 per cent of couples in this age group had ‘over-saved’, typically enjoying a surplus of more than £225,000.

Nine out of ten couples born in the 1940s have more than enough money to fund their lifestyles in retirement, the Institute for Fiscal Studies has revealed (stock image)

Mr O’Dea said many will find themselves with the luxury of either being able to improve their standard of living or to leave a large inheritance to their loved ones.

He said many are the beneficiaries of Britain’s housing boom, living in homes bought for a fraction of their current value. To add to their good fortune, the figures did not include the value of their state pension.

The IFS said younger people are unlikely to be so lucky, with a lower chance of having a gold-plated pension, a smaller state pension and a home less likely to rocket in value.

Angus Hanton, co-founder of the Intergenerational Foundation, which campaigns for fairness between generations, said: ‘These figures provide further evidence that government is prioritising the wishes of a wealthy grey generation, who vote in large numbers, while removing help from younger generations that need it more.

'They are increasingly burdened by student loan debts and sky-high living costs and are the section of society most in need.’

However, Neil Duncan-Jordan, of the National Pensioners’ Convention, said it was ‘almost impossible’ to find a couple enjoying the same quality of life as they had before they stopped work. ‘The cost of ageing is expensive, such as a care bill of £1,200 a week or having to pay a builder to do work that you used to be able to do yourself,’ he said.

Dr Ros Altmann, a pension expert and government adviser, also cast doubt on the findings. She said they were misleading because care costs were ignored: ‘There will be rising costs of health and social care that will need to be paid for in future, which have been ignored in this analysis despite rising life expectancy.’

Minister for Pensions Steve Webb said: 'We are finally turning the tide on the long-standing trend of falling pension saving. But there is more to do, with close to half of working age people not saving enough to maintain their standard of living into old age.

'Our reforms mean millions of people who didn’t have the chance to save in a workplace pension before will be on track for a more comfortable retirement. The fact is that almost everybody who has the chance to enrol into a workplace pension would benefit in the long run from doing so.

'New pension freedoms, giving people the power to make their own decisions about how they spend their retirement savings, are also making pension saving more attractive and I believe will help to boost savings rates.'

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The golden generation: Those born in 1940s retire with cash to spare. But today's young face a struggle